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Constructive dissent is essential to independent, well-informed board decision making and helps to reduce the risk of groupthink.
The chair sets the tone by encouraging respectful challenge, while structured agendas, preparation and clear behavioural expectations ensure debate remains purposeful and efficient.
Directors need to practise self-awareness, raising differing views in service of their governance obligations and the organisation’s best interests.
Consistently inviting and constructively testing diverse perspectives is essential to building a board culture where respectful dissent, curiosity and alignment around well-considered decisions are the norm.
Constructive dissent at board level is essential to independent and broadly informed decision making. “Unfortunately, ‘culture’ rarely rewards debate, so directors may talk about the importance of open dialogue, but in fact may feel threatened to engage in it,” says Anna Whitlam GAICD, CEO and principal consultant at WhitlamCo, and non-executive director of the Snowdome Foundation.
“Context matters when we’re talking about dissent,” says Dr James Allen, an organisational psychologist and a business founder/director, who now consults to boards and executives on improving decision quality and strengthening leadership effectiveness. He notes the level of constructive debate required depends on the matters under consideration.
“The key factor is that dissent must be part of the fabric of how a board operates and can be called upon as needed.”
The main benefit of encouraging and considering dissenting views on significant topics or decisions is that it reduces the incidence of groupthink, which Allen describes as the “psychological phenomenon where the desire for harmony overcomes the inclination to scrutinise and the need for critical thinking”.
This is not a licence to “chase unnecessary debate”, he says. Boards have to balance the need to consider a variety of views with “the efficiency and effectiveness of the group”.
So how do effective boards encourage and manage the raising of dissenting views in a manner that serves the purpose of good governance, supports the requirement for board efficiency and respects the psychological safety of board members?
The chair sets the tone
Board chairs as individuals set the scene for open dialogue, says Whitlam, by “the way they conduct themselves, both on and off the board”.
Allen agrees, adding that the direct behaviour of the chair signals to other members of the board that dissent is OK.
In board meetings, the chair can openly call for differing views by posing questions such as: Are we missing anything here? Does anyone see this differently? Is there perhaps a perspective we haven’t considered in this instance?
Whitlam adds that chairs should aim to “lead with calm and non-defensive communications, while also probing and/or intervening when unpopular views are shut down”.
Whitlam says such a culture, nurtured by the chair, supports a mature approach to governance in which the challenging of data, proposals and perspectives is encouraged and viewed as a demonstration of trust between board members.
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Pre-reads can emphasise an expected code of conduct
Board meeting structure and preparation are also vital to effective management of dissent as a tool at the board’s command. An agenda, issued in good time for due consideration — and which dedicates time for discussion of key points and debate — is crucial. Whitlam recommends “pre-reads with embedded questions for consideration in advance” to stimulate board members to think for themselves and open the door for a diverse and relevant discussion.
Many boards have a written code of conduct or a charter that includes expectations of board behaviour. When game-changing or contentious issues are slated for discussion, prefacing such items with conduct requirements can help focus directors on how to frame their points.
Directors may sometimes feel uncomfortable about surfacing differing views. Aligning the dissenting view to the requirement of directors to exercise independent judgement and act in the best interests of the company can be useful. “Anchoring to the purpose in raising that perspective can help,” says Allen. “This clarity of purpose, can allow directors to want to move into that space and raise that comment.”
The benefits of scenario analysis
Scenario analysis can serve as a more broadly engaging and concrete way to explore options. Allen suggests that even informal questions can shift the conversation. Examples include: What if we took a different action here? Would that have a different outcome that’s worth considering? Is there a scenario we haven’t discussed that would change our perspective?
More structured scenario analysis might help bring two or three outcomes into closer focus. “That’s the beauty of engaging people in scenarios,” says Allen. “It reduces some of the biases we know are at play in team dynamics, whether they manifest as groupthink or overconfidence in assuming the board is right and working to accurate assumptions”. Forcing a different case to be considered, even briefly, he says, can ensure the board is drawn into considering other relevant information.
Monitoring and reflection
Continuous assessment of board deliberations and time management help to keep meetings and outcomes on track. “Effectiveness can really start to unravel when people keep bringing up old issues or there’s a lot of debate, but no actual closure or decision,” says Allen.
The chair can be clear about which items need more space for deeper conversation, asking, “How are we going to come to a decision?” or “Any objections? No? Then we’re moving forward.”
Effective boards have processes in place to allow them to reflect on their performance. The AICD recommends following a rigorous, periodic, formal evaluation that enables continuous improvement. However, from meeting to meeting, says Allen, it’s important to recognise where the board may have gone off the rails. Again, posing a few pertinent questions is helpful. Did we operate at a level we feel comfortable with based on documented guidelines? What could we change or take forward into our next meeting? Are there any questions we want to take back to the business to allow greater board insight?
Communicating the outcomes of debate
If a board is comfortable that it has appropriately and rigorously arrived at a decision, the details of its deliberations may not be relevant to the business or the public. However, when there are clear options the board would be expected to consider, it’s important to reference that each option was discussed and different perspectives explored.
“The critical factors of communication are to instill confidence the role of the board has been executed, that it has remained independent and given matters the discussion they deserve,” says Allen. “And that it has arrived at an outcome and is aligned on that outcome.”
When non-alignment or individual director grievances come to public notice, it’s often a symptom that the environment around the board table isn’t conducive to raising and discussing dissenting views. When dissent surfaces outside the boardroom, a lack of control and alignment becomes obvious and can start to erode the confidence of shareholders and stakeholders.
Serving all stakeholders with integrity
Building a reputation for sound governance and consistent stakeholder value are central to any organisation. Having differing perspectives around the board table contributes to broadly and well-considered decision making, but dissent doesn’t need to enter into every conversation.
If differing perspectives are raised in the service of effective decision making, says Allen, board members will feel more comfortable presenting them and drawing them out from their colleagues. He says it’s critical to ensure this method of investigation doesn’t wane, but “lives in how discussions happen around the board table”.
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